Cubist Pharmaceuticals Reports Fourth-Quarter and Full-Year 2003 Results; Company Also Announces Discontinuation of CAB-175 Program; Conference Call & Webcast Today at 10:30 am ET.Business Editors/Health/Medical Writers BIOWIRE2K LEXINGTON Lexington. 1 City (1990 pop. 225,366), seat of Fayette co., N central Ky., in the heart of the bluegrass region; inc. 1832, made coextensive with Fayette co. 1974. , Mass.--(BUSINESS WIRE)--Feb. 26, 2004 Cubist Pharmaceuticals, Inc. (Nasdaq: CBST CBST Center for Biophotonics Science and Technology CBST Congregation Beth Simcha Torah (NYC) CBST Complete Binary Search Tree ) today reported results for the fourth quarter and full year ended December December: see month. 31, 2003. The company also announced that it has discontinued dis·con·tin·ue v. dis·con·tin·ued, dis·con·tin·u·ing, dis·con·tin·ues v.tr. 1. To stop doing or providing (something); end or abandon: clinical development of CAB-175, a novel cephalosporin cephalosporin (sĕf'əlōspôr`ĭn), any of a group of more than 20 antibiotics derived from species of fungi of the genus Cephalosporium and closely related chemically to penicillin. Cephalosporins, e.g. antibiotic antibiotic, any of a variety of substances, usually obtained from microorganisms, that inhibit the growth of or destroy certain other microorganisms. Types of Antibiotics , due to observed adverse events. Michael Michael, archangel Michael (mī`kəl) [Heb.,=who is like God?], archangel prominent in Christian, Jewish, and Muslim traditions. In the Bible and early Jewish literature, Michael is one of the angels of God's presence. W. Bonney Bon·ney , William H. Known as Bil·ly the Kid 1859-1881. American outlaw who murdered 21 men and was shot dead by Sheriff Pat Garrett (1850-1908). Noun 1. , President & CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of Cubist commented: "We are very pleased with the progress made at Cubist during 2003, having received approval for our flagship product A primary product of a company, which is typically why the company was founded and/or what made it well known. For example, MS-DOS, Windows and the Microsoft Office suite have been flagship products of Microsoft. CorelDRAW is a flagship product of Corel Corporation. , Cubicin(TM) (daptomycin Daptomycin is a novel lipopeptide antibiotic used in the treatment of certain infections caused by Gram-positive organisms. It is a naturally-occurring compound found in the soil saprotroph Streptomyces roseosporus. for injection), in the U.S. We are, in fact, quite a different company today than we were even six months ago. As a result of our achievements in 2003, we have now reached an important inflection point Inflection Point An event that changes the way we think and act. -Andy Grove, Founder of Intel. Notes: For example, the fall of the Berlin Wall was an inflection point in global politics and the commercialization of the Internet was an inflection point in technology. in the evolution of the company, as we transition from a research and development entity to a revenue-generating, fully integrated biopharmaceutical company. Over the past six months, we have completed building the initial phase of our CUBICIN marketing and sales infrastructure, completed our supply chain for CUBICIN, built a medical affairs department, launched and shipped our first product in the U.S., and strengthened our compliance and internal support functions by filling out our regulatory, legal and finance departments." Mr. Bonney concluded, "We invite you to join us later this morning on our conference call for a more in-depth in-depth adj. Detailed; thorough: an in-depth study. in-depth Adjective detailed or thorough: an in-depth analysis discussion of our results for 2003, other corporate activities and an update on the CUBICIN launch." Annual revenue for the year ended December 31, 2003 was $3.7 million, compared to $11.5 million for 2002. The year-over-year decrease in revenue was attributable to a discontinued partnership that accounted for $5.4 million in license fee revenue and $2.0 million in milestone revenue in 2002. Revenue for the fourth quarter of 2003 was $3.4 million compared to $1.1 million in the same period in 2002. Fourth quarter revenue included $1.7 million in net product sales of CUBICIN ($1.8 million in gross sales Gross Sales A measure of overall sales that isn't adjusted for customer discounts or returns, calculated simply by adding all sales invoices, and not including operating expenses, cost of goods sold, payment of taxes, or any other charge. ), as well as the recognition of $1.4 million of deferred revenue related to upfront payments from Chiron Corporation Chiron Corporation was a multinational biotechnology firm based in Emeryville, California that was acquired by Novartis International AG on April 20 2006. It had offices and facilities in eighteen countries on five continents. and revenue from Small Business Innovation Research grants. Sales and marketing expenses for the year 2003 were $21.1 million compared to $8.7 million in 2002. Sales and marketing expenses for the fourth quarter of 2003 were $9.2 million compared to $3.7 million in the same period in 2002. These increases were driven by the hiring of a dedicated Cubist sales force, as well as increased marketing activities related to the launch of CUBICIN in November 2003. In addition to the launch of CUBICIN, the company has been focusing internally on increasing financial discipline and improving the company's capital structure. To this end, Cubist began several initiatives in 2003, among them, a decision to consolidate company personnel and fermentation fermentation, process by which the living cell is able to obtain energy through the breakdown of glucose and other simple sugar molecules without requiring oxygen. Fermentation is achieved by somewhat different chemical sequences in different species of organisms. assets located in the UK to its Lexington, MA facility. Lease termination negotiations resulted in a one-time charge, recorded in general and administrative expense, of $12.9 million or $0.40 per share for the full year, of which $3.8 million or $0.10 per share was recorded in the fourth quarter. The cash payments for these charges will be paid out during the first and third quarters of 2004. Through this consolidation, the company expects to realize efficiencies in its natural product and manufacturing development programs and to realize significant cost savings over the long term. As of December 31, 2003, Cubist had $142.4 million in cash, cash equivalents and marketable securities Marketable Securities Very liquid securities that can be converted into cash quickly at a reasonable price. Notes: Marketable securities are very liquid as they tend to have maturities less than one year, and the rate at which these securities can be bought or sold has . During the fourth quarter, through the sale of common shares of the company, which netted Cubist $84.3 million, and as a result of up-front payments totaling $18.0 million to Cubist by Chiron Corporation for certain international commercialization rights to CUBICIN, Cubist added $102.3 million to its cash balance. Also during 2003, Cubist reduced its outstanding debt by $12.5 million by paying off bank debt and retiring $10.0 million of its September 2005 convertible bonds. The total number of common shares outstanding as of December 31, 2003 was 40,031,008.
CONFERENCE CALL & WEBCAST INFORMATION
WHEN: Thursday February 26, 2004 at 10:30 am ET
LIVE DOMESTIC & CANADA CALL-IN: (800) 404-1354
LIVE INTERNATIONAL CALL-IN: (706) 643-0825
24-HOUR REPLAY DOMESTIC & CANADA: (800) 642-1687 (#5388026)
24-HOUR REPLAY INTERNATIONAL: (706) 645-9291 (#5388026)
CALL WILL ALSO BE BROADCAST LIVE, LISTEN ONLY, VIA THE WEB AT:
www.cubist.com
Replay will be available for 30 days via the Internet;
a transcript of the call will be filed with the SEC and will also be
available upon request
About Cubist Cubist Pharmaceuticals, Inc. is a biopharmaceutical company focused on the research, development and commercialization of antiinfective antiinfective /an·ti·in·fec·tive/ (-in-fek´tiv) counteracting infection, or an agent that does this. drugs. In the U.S., Cubist currently markets Cubicin(TM) (daptomycin for injection), for the treatment of complicated skin and skin structure infections caused by Gram-positive gram-positive /gram-pos·i·tive/ (-poz´it-iv) retaining the stain or resisting decolorization by alcohol in Gram's method of staining, a primary characteristic of bacteria whose cell wall is composed of peptidoglycan and teichoic acid. bacteria. Cubist's pipeline includes an oral version of ceftriaxone ceftriaxone /cef·tri·ax·one/ (cef?tri-ak´son) a semisynthetic, ß–resistant, third-generation cephalosporin effective against a wide range of gram-positive and gram-negative bacteria, used as the sodium salt. (OCTX), a broad-spectrum broad-spectrum adj. Effective against a wide range of organisms, especially gram-positive and gram-negative bacteria. broad-spectrum adjective cephalosporin antibiotic in pre-clinical development Pre-clinical development is a stage in the development of a new drug that begins before clinical trials (testing in humans) can begin, and during which important safety and pharmacology data is collected. . Cubist is headquartered in Lexington, MA. Cubist Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. Statement Statements contained herein that are not historical fact may be forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, and such statements are subject to a variety of risks and uncertainties. There are a number of important factors that could cause actual results to differ materially from those projected or suggested in any forward-looking statements made by Cubist. These factors include, but are not limited to: (i) the level of acceptance of CUBICIN by physicians, patients, third-party payors, and the medical community generally; (ii) Cubist's ability to continue to develop, secure additional regulatory approvals for, and successfully market, CUBICIN; (iii) Cubist's ability to manufacture CUBICIN on a commercial scale; (iv) commercialization of products that are competitive with CUBICIN; (v) Cubist's ability to further identify, develop, and achieve commercial success for new products and technologies; (vi) Cubist's ability to establish and maintain successful manufacturing, sales and marketing, distribution, and development collaborations; (vii) legislative or regulatory changes adversely affecting Cubist or the biopharmaceutical industry; (viii) Cubist's ability to protect its intellectual property and proprietary technologies; and (ix) Cubist's ability to finance its operations. Additional factors that could cause actual results to differ materially from those projected or suggested in any forward-looking statements are contained in Cubist's recent filings with the Securities and Exchange Commission, including those factors discussed under the caption "Risk Factors" in such filings. Cubicin is a trademark of Cubist Pharmaceuticals, Inc. Tables Follow
CUBIST PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
UNAUDITED
(in thousands)
December December
31, 2003 31, 2002
ASSETS
Cash, cash equivalents and investments $142,399 $151,220
Property and equipment, net 45,221 48,268
Other assets 34,938 22,034
Total assets $222,558 $221,522
LIABILITIES AND STOCKHOLDERS' DEFICIT
Accounts payable $3,655 $9,600
Accrued expenses 26,191 6,289
Deferred revenue 13,118 2,500
Debt and capital lease obligations 197,810 210,033
Total liabilities 240,774 228,422
Total stockholders' deficit (18,216) (6,900)
Total liabilities and stockholders' deficit $222,558 $221,522
CUBIST PHARMACEUTICALS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
UNAUDITED
(in thousands, except share and per share data)
Three months ended Twelve months ended
December 31, December 31,
2003 2002 2003 2002
Product revenues, net $1,673 $- $1,673 $-
License fee revenues 1,517 115 1,517 7,515
Collaborative
agreements and other
revenues 170 972 526 3,971
Total revenues $3,360 $1,087 $3,716 $11,486
Operating expenses:
Cost of product
revenue 816 - 816 -
Research and
development 13,374 15,411 54,505 59,012
Sales and marketing 9,185 3,714 21,090 8,703
General and
administrative 8,174 4,182 29,978 17,471
Total operating
expenses 31,549 23,307 106,389 85,186
Operating loss (28,189) (22,220) (102,673) (73,700)
Interest income 476 1,004 2,182 5,199
Interest expense (3,380) (3,401) (13,601) (13,796)
Other expense (440) (135) (911) (115)
Total other
expense, net (3,344) (2,532) (12,330) (8,712)
Net loss $(31,533) $(24,752) $(115,003) $(82,412)
Basic and diluted net
loss per common share $(0.83) $(0.87) $(3.61) $(2.89)
Basic and diluted
weighted average
number of common
shares 38,065,054 28,570,430 31,872,555 28,515,435
Additional information can be found at Cubist's web site at www.cubist.com |
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